12/01/2023
How a startup building materials manufacturer with an innovative product, but was lacking an effective sales strategy, grew from $10m-$25m by hiring a strong VP of Sales.
EXECUTIVE SUMMARY:
An innovative startup building materials manufacturer had a disruptive product but stagnant sales. Misura Group recruited a VP of Sales to build the sales team, grow the LBM dealer channel, and expand their geographical reach.
The result:
The VP of Sales grew sales from $10m to $25m.
THE CHALLENGE:
STAGNANT SALES GROWTH
A startup building materials manufacturer with a cutting edge, disruptive product had an entrepreneurial founder/CEO and CFO/Head of Operations who had invested their life’s worth into the business they had built. The company was at $10m in sales, struggling to grow and gain share in the market.
CUSTOMER CONCENTRATION
The company’s sales were split 50/50 between one large big-box retailer and the LBM dealer channel. The founder, being concerned with customer concentration, could not grow the big box customer sales beyond the 50%. This left the focus on the LBM dealer channel, which was limited to a tight geography in the Northeast.
OUR SOLUTION:
THE RIGHT NETWORK
The company had a compelling product offering but they needed a leader who could scale the sales team and gain customers from other geographical markets. Misura Group recruited a VP of Sales who had deep knowledge of the LBM and specialty dealer channels, as well as a strong network in the Central and Western US.
INCENTIVE PLAN
Misura Group worked with the company to develop an equity-based incentive plan instead of a cash bonus which allowed the founder to free up cash to reinvest in the inventory growth needs of the business.
THE RESULTS:
The VP of Sales leveraged their network and industry knowledge to develop a pull-through sales plan. They provided product demonstrations for LBM dealer owners who were conservative and hesitant to be the “first one” in the market, and residential deck builders who could save time using their product. The VP also developed a metal fabricator sales strategy, opening up another channel to the multifamily construction industry. With this dual strategy, the VP of Sales increased sales revenue to $25m, and allowed the founder and leadership team to sell for a 9x EBITDA.
WHAT THE CANDIDATE HAD TO SAY:
“This was a unique opportunity for me as a leader. I love teaching people to sell, I love our industry. The daily competition with the young sales talent I am mentoring keeps me young.”
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